
Legal
What Is a Management Services Agreement?
By Michael Byrd, JD, ByrdAdattoIn the health care industry, there are many legal arrangements that help practices operate smoothly and ...
Posted By Mike Meyer, Wednesday, July 24, 2019
Jay Reyero, JD, Partner, ByrdAdatto
In addition to the bright sun being so prevalent during these warm summer months, the fraud and abuse enforcement spotlight shines bright on Oklahoma and Florida.
In Oklahoma, two cases were filed involving a total of three physicians and five marketers, who all were charged with anti-kickback violations involving compounded prescription drugs. In one case, the fallout continues from the compounding pharmacy prescription scheme involving OK Compounding, where three physicians and a marketer were charged with anti-kickback violations and other criminal offenses. The allegations involve kickback payments disguised through medical director and consulting arrangements with the pharmacies. In a second case, a Texas marketer was charged with conspiracy to pay health care kickbacks for recruiting physicians to prescribe compounded drugs in exchange for a commission based upon reimbursed prescriptions. In a final case, three marketers were charged with kickback violations for a direct payment to a prescribing physician.
These cases offer a reminder that medical director, consulting and marketing arrangements are heavily scrutinized and will not disguise any intent to pay for referrals. Parties must carefully analyze their arrangements and ensure the intent and substance behind the arrangement matches the form of the contract.
In Florida, an owner of a substance abuse facility pled guilty in a massive $57-million money laundering conspiracy involving hospital pass-through billing. In the scheme, the owner arranged for his facility to send patient urine samples to a laboratory for testing in exchange for 40% of the insurance reimbursement. The laboratory, in turn, entered into arrangements with rural hospitals to have the testing billed under the hospital's provider number using hospital in-network contracts. The owner also arranged for other substance abuse facilities to participate and receive 30% of the insurance reimbursement while he received the other 10%.
Hospital pass-through billing arrangements have become problematic as hospitals, clinical laboratories, and other parties seek arrangements to maximize both operations and profits. Arrangements between hospitals and laboratories must be closely scrutinized and regulatory compliance carefully analyzed.
If you want to keep your medical spa compliant with state regulations and move your business forward without engaging in illegal activities, click here to learn how to join AmSpa.
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